Why, oh why is childcare so expensive?

Uggh, we know. It’s the cloud of doom that seems to be ever hovering over us, growing in size and intensity no matter how hard we scramble for funds to keep it at bay. Why does it seem that childcare is getting ever more expensive? We’re working harder, putting in longer hours, trying to amass a small fortune so that we can have some semblance of a satisfying work/home/parent/a pinch of freedom life.

Is it too much for us to ask to be able to use our noggins and what we studied, a couple days a week, without having to give up our pound of flesh so that our sproutlings can be looked after? It’s the 21st century we cry to the heavens and that dark cloud of the childcare bill, surely there must be another way!? Is there any other way?

Nesha Hutchinson, the national vice president of the Australian Childcare Alliance stated, “There’s no denying the fact that prices have increased over the last 10 years, and over the last five years significantly.” Ms Hutchinson believes there are a few factors behind this upward trend. Regulation has had an inverse effect on childcare prices, while these regulation policies have been instituted out of a desire to keep our children safe, they have put pressure on costs. Educator-to-child ratios have been mandated through a National Quality Framework, there must be at least one employee to every 15 children.

This regulation has been great for ensuring that our little nuggets have a great quality of care but it has increased the costs for operators and that flow on effect comes trickling back to our hip pockets. “The price of child care definitely affects accessibility for families,” Ms Hutchinson says.

Ben Phillips, a principal research fellow at the ANU’s Centre for Social Research and Methods weighs in, “The overall level of affordability hasn’t altered greatly, but since prices have been rising and subsidies have not, it certainly has felt in recent years like child care’s become a lot less affordable.” His work has shown that across most capital cities in Australia, there has been a price increase of around 20%.

And what’s even more frustrating is that those working in the child-care industry are on relatively low incomes. Mr Phillips says that 90% of the workforce in childcare in female and they are unlikely to ever reach the average Australian salary of $80,000. Yet amongst all these factors, IBISWorld reviewed the sectors data to state that in 2011 the Australian childcare industry made over $7 billion in revenue.

In terms of world comparisons, Australia seems far behind. Stacey Fox, an adjunct fellow at the Victoria University’s Mitchell Institute stated that “Most of the rest of the world has almost universal access to two years of preschool, in Australia, we’ve only got about 30% of our three-year-olds attending preschool programs.” It is estimated that Australian families spend 35% of their private income on preschool costs while many international governments are picking up 90% of the bill.

While the Federal Government has announced changes to child care policy, taking effect from July this year, there is still great need for change. The two main existing subsidies for child care will be compiled into one, examined on the activity of parents: parental commitments of work or study. Yet this doesn’t address larger concerns as to lower income families whose relation with work and study is complex and whose children benefit the most from child care access. Additionally there is the concern as to the inability for personal and as-close-to-parent care for kids booked into long hours of childcare.

KidNest wants to address this. KidNest wants to turn how we do child care on its head, do a roly-poly and come out the other side cheaper for parents, better for kids and a whole lot more beneficial to everyone involved.